Richer, AU-US10Y Narrower, MYEFO Due

In futures roll-impacted dealings, ACGBs (YM +1.8 & XM +4.6) are slightly stronger after US tsys finished mainly richer ahead of today’s FOMC decision at 1300ET and Fed Chair Powell's presser at 1430ET. An in-line November CPI print did nothing to discourage expectations for a less-than-hawkish outcome from the Fed.

• The Fed will likely lower its median "dot plot" estimate for policy interest rates at the end of 2024 to around 4.9%, former officials and staffers told MNI, as expectations build for the first rate cut to come as early as the year's first half.
• "My expectation is that the median will probably show two 25-basis-point cuts next year," said ex-Boston Fed chief Eric Rosengren, whose forecast is for two to three cuts starting as early as the second quarter.
• Cash ACGBs are 2-4bps lower, with the AU-US 10-year yield differential 4bps tighter at +8bps.
• Swap rates are 1-3bps lower, with EFPs slightly wider.
• The bills strip is flat to +2 across contracts.
• RBA-dated OIS pricing is +/-1bp across meetings.
• Late this morning, the local calendar sees the government’s Mid-Year Economic and Fiscal Outlook (MYEFO) published, with Treasurer Chalmers giving a press conference. This afternoon CBA’s household spending insights print.